Construction: Spring-time revival

After the business climate in construction cooled significantly, from a high level, over the winter months – even disregarding the purely seasonal component – a slight improvement was observed in March. This was due to a more favorable overall assessment of the current business situation by the survey respondents, who widely reported a positive current situation. However, further improvement in the coming months is expected by fewer contractors. The equipment utilization rate rose by a clear 3.2 percentage points and, at 82.0%, was just short of a new post-reunification record high. Order reserves, however, declined marginally. On average, orders now ensure 4.0 months of production compared with 4.1 months in the previous month. Nevertheless, participants are again somewhat more satisfied with their order books. Constraints to construction activity were reported much less frequently in the March survey, the share of these reports having fallen from 70.5% to 47.5%. By far the most frequent constraints were adverse weather conditions, which still affected 27.6% of the survey participants (56.0% in the previous survey). Labor shortages gained slightly in importance, with 12.9% of the contractors having problems filling their vacancies in a timely manner, which amounts to an increase of half a percentage point. In March, 9.1% of the companies complained of a lack of orders, compared to 12.2% in the previous month. The other construction obstacles were of minor importance in the March survey. Construction prices were raised slightly less frequently. For the near future, many companies anticipate more scope for further price increases, although expectations in this regard were somewhat more optimistic in February.